Those burning the Brisith flag are a small grupete like Quebracho, la Cámpora, etc. There is no need to exagerate, mainstream Argentines would never do something like that.
Furthermore, all the war talking seems to be comin from the UK nowadays, as I think that not even the most loyal Kirchnerista or Quebracho militant would believe Argentina could manage to bring soldiers to the Islands. Probably the landing ship would run out of fuel or sink due to the waves.
While not a Kirchnerista, I believe Cameron's comment regarding Argentina being colonialist was a big fauxpas.
Regarding the dispute itself, both sides believe they have good reasons to claim sovereignity...but actually none can prove it, it is a matter of interpretation of things that happened during the last 500 years. That the people on the Island want to be British is fine, but they were implanted there just after the Argentine population was forced to move away. For me then, this does not count as a good argument. There has to be some kind of negotiation at some point, specially if the fish stock gets terminated and no huge oil reserves are found...the cost burden will be too high for the UK govt.
The solution has to help the Brits save face though, which I think will be the most difficult to achieve.